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Headline inflation continues to slow down.

Kyiv: For the third consecutive month, headline inflation continued to slow down reaching 13.1% yoy in April 2018 (compared to 13.2% in March).

Inflation dropped from 1.1% mom in March to 0.8% mom in April, according to data from the State Statistics Service of Ukraine. Inflation in April came in slightly higher than projected in the April 2018 Inflation Report, driven by most volatile CPI components.

The NBU's tight monetary policy continued to restrain price growth. So far, the effect of the tighter monetary policy has mainly been transmitted through the exchange rate channel, prompting the hryvnia to strengthen since late January 2018. This in turn affected the prices of imported goods that have shorter shelf lives.

A further increase in production costs, including labor costs, and a rapid recovery in consumer demand kept inflation high. In addition, the prices of some imported non-foods reflected the weakening of the hryvnia exchange rate seen in late 2017 and early 2018, as these goods (e.g. spring and summer clothes and footwear) are purchased by retailers in advance. The high inflation expectations of some economic agents also contributed to the strong inflation pressure.

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Publication:Daily the Pak Banker (Lahore, Pakistan)
Date:Jun 14, 2018
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